AudioCodes (AUDC) investor relations material

Executive summary

• Revenues for Q1 2026 rose 2.9% year-over-year to $62.1 million, driven by growth in managed services, Conversational AI, and Microsoft Teams segments.

• Conversational AI business grew over 50% year-over-year, now accounting for roughly 8% of total revenue and achieving record revenues for Teams-certified solutions.

• Live annual recurring revenue increased nearly 20% year-over-year, reflecting strong recurring revenue momentum.

• Transformation into a voice AI-driven hybrid cloud software and services company continues, with strategic investments in R&D and sales.

• Net income was $2 million ($0.07 per diluted share), down from $4 million ($0.13) in Q1 2025; non-GAAP net income was $3.8 million ($0.14 per diluted share), compared to $4.7 million ($0.15) last year.

Financial highlights

• Services revenue grew 4.3% year-over-year to $34 million, now representing 54.7% of total revenue.

• GAAP gross margin improved to 66.2% from 64.8% in Q1 2025; non-GAAP gross margin reached 66.3%.

• Non-GAAP operating margin was 7.7%, down from 8.9% in Q1 2025.

• Adjusted EBITDA margin was 9.4%, compared to 10.2% year-over-year.

• Net cash from operating activities was $12.8 million for the quarter.

Outlook and guidance

• 2026 revenue guidance reiterated at $247–$255 million, with non-GAAP EPS expected between $0.60–$0.75.

• Voice AI segment targeted for 40–50% growth in 2026, aiming for $25 million revenue this year and $50 million by 2028.

• Management expects continued healthy top-line growth for the remainder of 2026, supported by investments in Live services and Voice AI.

• Ongoing transformation into an AI-driven hybrid cloud software and services organization is expected to drive future expansion.

• Forward-looking statements highlight expectations for continued growth in cloud services and AI applications, but caution about risks from global economic conditions and competitive pressures.